The growth in the Indian economy has been phenomenal in the past decade and this has been reflected in the prosperity of its industrial sector. The publishing industry was no exception to this and hence, the Indian book market has opened up significantly. Entry of multinational players in the markets has raised the bar of the quality of work being produced. At the same time, increase in the per capita income of the people has led to higher purchasing power and a substantial improvement in the standards of living of the people. With a population of 1.3 billion people and a literacy rate of 65%, the Indian market presents highly lucrative opportunities in the book market particularly in the children's category. Currently, the demand is met by a supply of imported literature produced by foreign authors. Hence, there is a demand for quality work in the children's category of the Indian book market.
The Harry Potter brand is one of the most successful stories of recent times. The total value of the brand is estimated to be around $15 Billion which spans across industries and international boundaries. In this study, the attempt has been to analyze the reasons for the success of the Harry Potter brand from content to the marketing strategies that have been used.
Hence, this research aims at identifying the need gaps in the children's book market in India and attempts to recommend courses of action that can be taken by writers and publishers in order to create a brand like Harry Potter. The study also attempts at understanding the lifestyles and reading habits of the Indian teenagers and pretweens in an attempt to unearth their tastes and preferences with regards to literary works of art. This would help writers and publishers in understanding their customer segment better and directing customized marketing activities towards these segments.
Harry Potter is a series of seven novels written by author J K Rowling describing the life and adventures of a young orphaned boy named Harry Potter and his two best friends named Ronald Weasley and Hermione Granger. The books illustrate the trivial yet important experiences that children go through in their personal and professional lives in the process of becoming an adult. Therefore, it identifies with each and every one of us with its myriad depiction of characters.
The first book was completed by the author in the early 1990's and then had a difficult time holding the interest of the publishers. When it was finally published in 1997, it became quite popular with the children. However, it was not until the third book was published that the series became the rage. What followed was an intriguing mix of marketing, merchandising strategies which gave birth to one of the most successful brands ever created. As of June 2008, the book series has sold more than 400 million copies and has been translated into 67 languages and the last four books have consecutively set records as the fastest-selling books in history.
Since 1998, when Nielsen began measuring book sales in the United Kingdom, the six Harry Potter books have sold more than 22.5 million copies in the UK alone. In the United States, the Harry Potter titles published after 2001 have sold more than 27.7 million copies (Nielson, 2007).
Today, the worth of the Harry Potter Brand is in excess of $15 Billion (Advertising Age, July 16 2007). While approximately $9 Billion is from the sale of books alone, the rest comes from activities like movies, licensing, merchandising, gaming, music and advertising.
What is fascinating to note amongst all this is the fact that more than 60% of the Harry Potter books sold in 2003 were bought for adults, not children, according to a research conducted by Book Marketing Ltd (BML). The figures also suggest that Harry Potter has not helped grow the children's books market. Instead, sales to children under 12 years old are reported to have fallen in each of the last three years. Even the story plot of the books has evolved with the passage of time and is no longer targeted at children. In fact, a lot of the content deals with real life issues being faced by adults and is contrast to the expectations of its earlier readers. On 28 March 2007, the cover art for the Bloomsbury Adult and Child versions and the Scholastic version were released. A survey done in the US in 2006 revealed that not only had parents of children read most of the Harry Potter series, they believed that reading the book had made their kids become better readers and had also helped them in school.
Through all these efforts the brand has been able to grow itself across categories. It has created a strong market for itself in the minds of consumers across social and cultural segments. There is a need to examine how a brand has totally repositioned itself in the middle of its life cycle and in doing so opened up exciting new opportunities for its growth.
The global market for children's books has seen a decline in the past few years. Book Publishers in the US are feeling the pinch of operating in a declining industry, with sales revenue declining over the last five years. Price is a key basis of competition, and major players operate on small margins and big economies of scale (IBIS World Industry Report, October 2009). However, the Harry Potter brand has continued to grow its readership and its revenues in the plight of such events.
Coming to the Indian market, the worth of the Indian publishing industry is estimated anywhere between 1.3 and 1.6 billion dollars and is the third largest in the world in English language publishing. India's demographic profile has created a lot of potential investors from multi-national corporations including publishers. But owing to its historical background, there is a lack of creativity, imagination and publishing skills in the domestic industry.
This research expects to understand the strategies that have been implemented by the author, publisher and marketers of The Harry Potter series to grow the brand across categories in other global markets. The study shall also try to assess the possibility of replicating the strategies in the Indian market which would result in further growth of the market.
The Indian Book Market
The Indian book market has a centuries old experience of publishing and book selling. India is the 7th largest publisher in the world and the 3rd largest publisher when it comes to texts produced in English. It is a 9000+ Crore industry and is one of the biggest markets in the world second only to the US and the UK. Before Independence the industry was controlled by the British and hence there was an element of homogeneity in the publishing market. TATA McgrawHill was the only major publisher that existed then and was a joint between the TATA's and the McGrawHill publishing house. However, the era after Independence saw the rise of publishing giants like Kali, Seagull and Roli.
There are more than seventy thousand books published in the Indian market out of which only 20% belong to the English category. However, due to the excessive requirement of English textbooks the total worth of the material published in English has grown significantly. The Indian market is characterized by a very high number of publishers and retailers and the costs of producing books in India are comparatively low (Francis, 2007)). Also, the final price of a book in the Indian market is relatively cheaper than books in other developed markets. Hence, the Indian market has caught the eye of the global publishing industry.
Currently, the Indian market has seen an influx of foreign publishing houses that have entered into joint ventures with India conglomerates in order to exist cost effectively. With the advent of liberalization in the 1990's, publishing giants like Penguin, Harper Collins, Scholastic, Bloomsbury, Random House and Hodder have formed sustainable joint ventures with Indian publishing houses and quite a few are even looking at off shoring a part of their publishing activities to developing countries like India where the costs of production are low and the sales price is 2-3 times the production cost. The result of these partnerships is that the Indian publishing Industry now possesses the most technologically advanced production services in the world in addition to financial resources, employment opportunities and structured training and skill acquisition practices. This gives the Indian publishing industry an edge over its national rivals like Russia, China etc. This service industry has quickly become a global supplier to publishers across the world, but especially Europe. Investment has been heavy but competition is fierce and prices have remained very keen as a result. Costs for Indian publishers are therefore low by global standards, while production standards have improved radically (Katyal, 2007).Also, apart from technology related to the publishing industry, India is one of the world leaders when it comes to providing leading technology as far as IT and communications industries are concerned. Hence, the Indian publishing industry is backed by the unparalleled cost effective back end services provided by these industries.
In addition to the factors listed above, the tremendous growth witnessed by the Indian economy has also been largely responsible for shaping the success of the publishing industry. The population of the country is in excess of 1.2 billion which provides a potentially large base of readers. Also, the burst in the economic growth has brought about an increase in the per capita income of the people coupled with a dramatic increase in the purchasing power. Efforts made by the state and central governments, and rising consciousness amongst the population have brought about a substantial increase in the literacy levels as well as a positive change in the lifestyles of the people. Not only are people more willing to indulge in purchase of books, people are actively investing their time in looking up good literature.
Due to the importance of English as an international language, literature written in English is being given due prominence. The result being that India is beginning to compete with international publishing houses where English literature like textbooks, monographs and other literary works are involved. A recent survey conducted on global reading habits has showed that Indians have the highest consumption of literature and spend the most amount of reading. The youth population of the country is constantly hungry for good quality contemporary English literature which is one of the major areas for the growth of the industry.
While we are looking at the core strengths of the Indian publishing industry, there are a lot of weaknesses which are hindering the progress of the industry. Lack of infrastructural facilities among a number of the smaller publishing houses is resulting in inefficient management which is giving away business to the rival publishing houses in nearby developing nations. The low cost of production and sake has made the returns in the India market a volume game. The earnings per unit are low and the publishing houses need to publish substantial print runs in order to earn a sizeable profit.
The supply chain of the Indian book market is currently long and tedious and hence increases the production costs leading to lower revenues.
The sales and distribution channel needs to be improved for the returns to increase. The lack of availability of data documenting the activities of various publishers and the use of traditional and outdated practices followed by domestic publishers leads to a waste of resources and a drop in the revenues of the industry. The Government of Brazil has developed an excellent system to tackle this problem in their industry. "The Brazil Book Chamber commissions a group of academics to prepare an annual report for the Chamber. They obtain the required statistical information from member companies on a confidential basis and then collate the information into a useful and robust report on an annual basis" (Francis, 2007)
Another issue crippling the growth of the industry is the presence of multi-national publishing houses in the country. Organizations partly owned by foreign multi-nationals are becoming targets of off shoring activities which has created a rift between these corporations and indigenous industries. The regulating government organizations for the two are also different which leads to a clash in the policies governing their action. Also, content for these publishing houses is imported and written by foreign authors, which suppress the growth of the potential Indian writers. Global brands like Harry Potter and Lord of the Rings take precedence in the minds of the readers and Indian literature is relegated to the sidelines. Hence, publishers are skeptical to publish the works of lesser know writers and prefer to go with trusted international names even in the domestic market. The publishing of textbooks provides a constant source of revenue for the publishing houses and the revenues earned from these areas is pumped into the production of other literary works. In India, the state government has strict control over the publishing of textbooks which handicaps the revenue streams of the indigenous publishing houses which then affects the publishing of other works.
"Brazil and Mexico offer excellent models for how government and industry can work together to ensure the requirements are met. In both countries (Brazil at primary level, and Mexico at middle school level) the Ministry of Education purchases books from publishers at very low net cost, and then provides these textbooks free to the children in the state schools. The schools thus have a choice; textbook standards are high due to the competitive market; government is buying cheap; the children receive good books free" (Francis, 2007)
The diversity in culture in India also proves to be a stumbling block where the publishing of books. Due to presence and popularity of localized content in regional dialects, Indian publishers are forced to print editions in multiple languages which inhibit economies of scale from accruing.
In conclusion, we can summarize the trends by conducting a SWOT Analysis of the Indian Publishing Industry like in the diagram illustrated above.
The Children's Book Market in India
The rapid economic growth of the Indian economy has provided a boost to many industries including the publishing industry in India as illustrated previously. With the increase in the purchasing power of the people and the resultant improvement in the standards of living, people are actively looking towards collecting books and are constantly on the lookout for popular literary works. The economic, social and cultural changes taking place have given rise to an educated mass of people who are hungry for information. The increase in the intensity of competitions and examinations, and the fight for survival in the corporate world has given parents the impetus to urge their children to cultivate reading habits. The market for children's books has expanded tremendously and Indian authors and publishers are still struggling to cope with it. From being a neglected industry, the Indian book market has suddenly caught the fancy of the global publishing houses.
"The market for children's books in India is influenced by foreign authors and imported books. Mainstream publishing today caters to two kinds of markets -quality books for the more discriminating English-speaking urban elite and mediocre to poor quality books for the masses made up of India's vast and growing middle class. Both markets are huge and growing and will keep the children's book market thriving" (Menon, Main Characteristics, Main Challenges, Main Perspectives for the future, 2006)
In developed countries like the United Kingdom, children's books including picture books, textbooks and fictional thrillers account for nearly 25% of the total market. Now, as there has been a relative slow down in the developed economies where book are concerned, newer markets like India are seeing a burst of development and investment from international brands like Disney and Scholastic. This has provided incentive to Indian authors as well as publishing houses to meet competition and provide quality children's literature at affordable prices. This will result in higher standards & more creativity, a very welcome change thereby opening up opportunities for new writers & illustrators.
However in India, the children's book market been crippled mainly due to lack of infrastructure facilities. Inaccessibility of well stocked libraries and book shops mainly due to limitation of financial resources has led to scarcity of good literature available to young readers until now. With the entry of global retailers like Landmark and Crossword the scenario is changing rapidly and so is the demand for books.
However, this sudden explosion in the retail space has caught the publishers as well as the authors in the segment unawares. While books like Harry Potter and Lord of the Rings have attracted readers into the market, there is scarcity of Indian authors who can come up with quality literature in this segment. There is a strong demand for talented writers who can come up with books that the Indian youth can relate to. For example, one of the reasons for the success of Chetan Bhagat in India is the fact that his works appeal to a very specific segment in the Indian market. Bhagat's first book, Five Point Someone, which was published some time back and has now been successfully made into a major motion picture, was based on the lives of three Indian teenage boys doing their engineering and the challenges that came that way. The books struck a chord with the millions of youth who have experienced the ruthlessness of competitive examinations in India. It deals with the emotions of young teenagers as they are propelled by societal and family pressure into competing against millions of other students and the psychological and physical trauma that they go through. The book was the national bestseller for weeks and was read avidly not only by teenagers and young adults who had gone through this phase themselves but also by young preteen adolescents who were about to make the same journey.
Genre: Fantasy Fiction
Genre fiction also known as category fiction or popular fiction refers to literary work of fiction written with the intent of fitting into a particular type of literary genre so that it appeals to people who are familiar with that genre. A genre basically helps to classify works which will appeal to a particular set of people who have familiar tastes. Different types of genres include fantasy, romance, mystery, detective, horror, science and literary. Looking at the children's category, be it any market, fantasy fiction is the most popular genre. Fantasy fiction is a genre that uses mythological characters or magical/supernatural beings in the primary formation of the plot. The most successful examples of fantasy fiction are Harry Potter, The Chronicles of Narnia, Peter Pan, The Wizard of Oz and The Lord of the Rings. While earlier the market was dominated by foreign authors and a few Indian book legends like Amar Chitra Katha, Tinkle, Champak etc. now there has been an influx of Indian authors and multinational publishing houses bent on widening the scope of the market. Where domestic works are considered in the fantasy fiction genre, the focus has been more on numerous short stories rather than heavy tomes such as Harry Potter. The Hindu mythology has also been very popular amongst the children and have also been endorsed by parents wanting to instill cultural and religious knowledge amongst their children especially Indians living abroad.
Reading Habits and Lifestyles of Children
There is a startling lack of data available on the reading habits and lifestyles of children in India. Of the 1.2 billion population tweenagers and teens together comprise an approximate total of 23% according to the National Statistics provided by Euromonitor International. Hence, they serve as a large potential market for publishers to look at.
A survey done on students of Kendriya Vidyalaya detailed the trends in the reading pattern of children across different age groups. The paper explores the purpose, frequency and tastes and preference of students in these schools. What emerged strongly from this study was the fact that by the age of nine, boys and girls have significantly tastes; girls will still read fairy tales while many boys have rejected them. Both boys and girls of ten to eleven like adventure stories involving group activity but boys show a preference for wider and rougher adventure. Girls like store set against a family background which deals personal relationships and reflect their need to love and be loved. By the age of twelve girls are interested in romance about girls slightly older than themselves, while boys like science fiction, mysteries and facts (Sharma & Dasgupta 2009)
The problem is becoming more acute to look at fiction for this age group (9-12) in terms of convenient categories i.e. Fantasy, Adventure, Dom6stic, Adventure stores new usually have some elements of domestic features and growth, domestic features and growth, domestic stories unfolds in a way that makes every-day life seem exiting and fantasy stories usually involve both adventure and domestic elements
Classification of reading preferences of children based on age:
Children Below the age of 5: Board books including word and counting books, concept based books, picture books illustrating fairy tales and popular nursery rhymes. The emphasis in these books is basically on visual content as the book is read aloud by adults. Colorful pictures, good quality paper and original artwork are prerequisites. The purchase of these kind of books is totally influenced by parents.
Ages 4 - 8: These are the books which are read by children after they have just learnt how to read. Hence the use of colorful and engaging pictures coupled with simple grammar and short uncomplicated plots are required. Even here, parents are the sole decision makers in the buying process.
Preteens: Adventure, mystery and fantasy fiction genres are the most popular genres in this group. The plot and characters are relatively uncomplicated and there is a huge demand for magical and supernatural characters in this story. Popular examples are Harry Potter and mythological stories which are endorsed by parents in an effort to inculcate cultural knowledge amongst their children. Short stories are also very popular in this age group.
Teens & Young adults: during this period the teens develop the sense of values and learn to look deeper into the meaning of things while still sensitive to the magical/supernatural stories. Harry Potter is a very good example to quote over here as the plot explores the emotional and physical experiences that Harry and his friends go through while the main plot still revolves around magical mystery.
The Harry Potter Story
The global success of the Harry Potter brand is nothing short of magical. What started as an innocent attempt to capture the attention of young kids has blossomed into a super brand that has caught the fantasy of children and adults likewise. Within a span of 10 years the brand has gone from being just another children's novel to being a multi-billion dollar global phenomenon.
The original manuscript written by Rowling was rejected by several publishing houses before it was published in 1997. Bloomsbury was responsible for the publishing of the book in London, while Scholastic published the book in the US under the name of Harry Potter and the Sorcerer's Stone. The rest as they say is history.
Harry Potter was launched at a time when there were recessionary trends in the book markets globally especially in the children's category. There was much hype about new media like television and the internet and reading habits were not being cultivated amongst children. The Harry Potter series have broken all records in the publishing world and set new higher standards when it comes to children's reading. Apart from the phenomenal success of the brand, another reason for studying the growth of this brand was the way in which it rejuvenated the mature market for children's books in the US and the UK. Also, it gave a much needed impetus to Bloomsbury London and helped generate a versatile revenue stream.
Another unique aspect of the series is that it appealed to readers across different age groups and cultures. The original story plot has captured the attention of adult readers around the globe. Scholastic has released statistics to support their claim that fifty percent of the books in the series have been bought by readers thirty-five years or older. Brenda Bowen, executive vice president and publisher of Simon & Schuster Children's publishing and twenty-one year publishing veteran confirms this surprising information. The raving success of the series amongst adults led publishing giants like Bloomsbury and Scholastic to introduce adult cover versions of the book for in 2007. Also, after the sales of the books started dwindling, Scholastic launched advertising campaign with posters targeted specifically towards adult readers (Nielson, 2009). It also gave rise to formation of multiple communities and discussion forums like "Harry Potter for Grown Ups" and "Harry Potter for Adults" which catered solely to the adult fanatics of Harry. The reasons for this surge in consumption of these books by adults are many. The storyline recounts the trivial yet very important experiences that every adult goes through as a child. Also, the plot revolves around a young talented wizard who has been wronged at many counts yet remains true and humble which strikes a chord with every reader be it a child or an adult. The struggle for existence and the continuous fight against the evil or "dark" forces as well as the rebellious exploits of Harry Potter and his friends provide an escape from the ordinary mundane lives of the people. Also, at the end of each book a group of survivors stand together and celebrate, enjoying a brief moment of reprieve before the next battle begins which identifies with the basic nature of human beings be it of any age group.
The Potter Series were published at a time when the global boo market was facing a slowdown and publishers were desperately struggling to find further sources of avenue especially in the US and UK markets. The shares of Bloomsbury London had been steadily declining as was common with publishers across the globe. Of the multi-billion brand that Harry Potter is the most major source of income for the publishers is the sale of books with over 320 million copies in print. The books had become bestsellers before they were even released owing to advance orders being placed through the various distribution channels. The huge demand for the books also brought about synchronization in the different production processes involved in the successful launch of the series. With the launch of each book, new cost effective ways managing the enormous demand were discovered. Online media was used by the publishers to generate hype and anticipate the demand through advance bookings made on internet sellers like eBay and Amazon (Kotarba, 2003).
Customization of content was also done to suit the cultural needs of the market in which the books were released. The Harry Potter series have been translated into 64 other languages so far and the content has been suitably modified to appeal to the readers of that particular region. Translation strategies were such as substitution of names or including popular regional dialects to convey the meaning to readers. The publishers also came out with different cover versions for adults owing to the popularity of the series amongst adults.
Also, the success of the Potter series gave the impetus to publishers to come out with more books targeted at children and it drew the attention of adults towards other authors of children's books.
""The Potter books have made children's literature more visible, the market more receptive to hardcover editions of new children's fiction and reviewers more willing to tackle juvenile titles in their columns." (Weinburg, 2003)
The success of the first book, Harry Potter and the Philosopher's Stone triggered an avalanche of marketing activities undertaken by Scholastic and Bloomsbury for building the brand especially in an industry where marketing is considered expendable.
"The books business is widely regarded as a marketing backwater, a domain where marketing is either reviled or practiced with considerable reluctance." (Kotarba, 2003) (Rowland, 1996; Schiffrin, 2002).
The launch of the editions saw innovations in areas of distribution, advertising and retail promotions. From organizing international book reading by JK Rowling in the Hogwarts Castle where the film was shot to the launch of a multi-million dollar marketing campaign seven weeks before the release of the seventh book the publishers left no stone unturned. The growth of a brand can also be taken as an example of how a brand can be successfully repositioned once it approaches maturity. After the sales of the series petered down, an advertising campaign targeted solely towards adults was launched in an effort to expand the readership of the books.
The concept of reverse product placement was also used with great effect in the marketing of the books. Reverse product placement refers to the commercial translation of fictional brands from popular works into the real world. Hasbro, the world's largest toy maker purchased the licensing rights from Warner Bros. to manufacture products used in the books and followed in the movies like Bertie Botts Every Flavor Beans, Ollivander's Wands and other games.
Definition of Research Problem
Understanding the reading habits of teenagers in India, availability of various categories of literature and how certain categories of literature can be expanded the way Harry Potter did in the global context.
The study involves a feel of the Indian market and since there is paucity of data related to the Indian publishing industry and the book market, the research methodology will involve a preliminary secondary research conducted to understand the drivers of the Indian book market. Based upon the data acquired, a qualitative research will be conducted amongst publishers, retailers and organizers of book fairs through expert interviews.
The research would also involve a study of consumer profiling and behavior done through analysis of data collected through in depth interviews. Understanding the popularity and potential of expanding various genres would also be included in the study.
A part of the research is to find out the strategies implemented for the success of the Harry Potter brand in other markets. The information required would include industry figures pertaining to the growth of the brand in these markets, trends in the genre of fantasy fiction books in Indian as well as overseas markets as well as consumer profiling and consumer responses toward the Harry Potter brand.
Recent economic growth of the nation and the general slowdown of mature markets in developed countries have a made India a potentially large and untapped market with untapped opportunities. There has been a constant influx of foreign publishing houses and literary works produced by foreign authors to establish themselves in the minds of the readers. There has been a scarcity of popular works of fiction produced by Indian authors till now.
Hence, this research aims to understand the dynamics of the publishing industry as well as the reading preferences and lifestyles of the Indian children as an attempt to provide a mix of marketing strategies and customer profiling for up and coming writers as well as publishing houses.
Secondary Research Design
Secondary Research will be conducted on the study the success of the launch of the Harry Potter Series across all 7 books. Marketing activities including promotions and distribution channel selection will be studied to gauge the coordination among the publishers and the synchronized roll out of the books across the globe
The research shall also attempt to understand the key driving factors of the publishing market in India and the major revenue streams for the publishing houses in India.
Current trends in the children's market will be analyzed to cull out need gaps which can be filled by contemporary Indian writers by publishing works in the children's book market
Primary Research Design
- A qualitative research would be conducted amongst children who are readers of Harry Potter and satisfying pre-decided demographic (age, gender and socio economic classification) criteria would be selected.
- Responses would be taken describing reading habits, reasons for preference of Harry Potter books and any other popular author/book/comic that they prefer
- Also, a qualitative research will be conducted amongst publishers of Harry Potter books in India as well as small scale retailers and book sellers.
- Responses collected will relate to the data supporting the success of Harry Potter books in India as well as popularity of other children's books in the fantasy fiction genre.
- Data pertaining to the lifestyles and reading habits of the children will also help in anticipating need gaps and touch points in the lives of the consumers.
Target Group for the random interviews amongst children would be:
- Belonging to SEC A/B
- Aged between 10-17 years
- Residents of tier 1 and tier 2 cities
- English Speaking/reading and have read at least one of the Harry Potter books
Target group for depth interviews amongst publishers/retailers:
- International retailers like Bloomsbury/Scholastic responsible for the distribution of children's books
- Organizers of book fairs in schools
- Small scale book sellers/retailers belonging to metropolitan cities
Sample size for random interviews conducted amongst children:
- Total Sample: 40 children ( 10 each in the four cities)
- Gender Split (M/F): 20/20
- Age wise split:
Sample Size for expert interviews with publishers/retailers will depend upon availability of contacts.
The research hopes to make valuable contributions in the following areas:
- Current trends and reading patterns relating to different genres
- Data regarding the reading habits and lifestyles of children in the specified target group
- Awareness and preference of the Harry Potter series and identification of any other popular novel/author
- Shift in the preference of a particular genre with the advent of time
- Extent of parental involvement in purchase of books
Scholastic Revenue Model
Scholastic, a US based publishing house, has been the leader in children's brands and distribution. It was constituted in 1920 by Mr. Richard Robinson.
Scholastic is a manufacturer of quality educational and entertainment products like teaching material, children's books, and technology based software, magazines, feature films videos, television programming and toys. The different distribution channels for this organization include retail stores, schools, school-based book clubs, school-based book fairs, libraries and television networks. Following is the revenue model for the organisation:
- School-Based Book Clubs - These book clubs are offered at schools in many countries. Normally, teachers administer the program in their own classes, but in some cases, the program might be administered by a central contact for the entire school.
- School-Based Book Fairs - Book fairs are usually run by schools and/or parent teacher organizations which span over a five business-day period.
- Trade - Retail outlets are opened through distribution of franchise which is dependent upon the existing market conditions.
- Educational Publishing - For shipments to schools revenue is recognized when risks and benefits transfer to the customer. Shipments to depositories are on consignment and revenue is recognized based on actual shipments from the depositories to the schools. For certain software-based products, the Company offers new customers installation and training and, in such cases, revenue is recognized as services are provided or over the life of the contract.
- Toy Catalogue - The catalogue contains the available and in-production play-ware by the company.
- Film Production and Licensing - The licensing of a film takes place through acquiring its sales rights. Film Production also happens in some cases. The basic focus is on the home video and domestic and foreign television markets. Licensing revenue is recorded in accordance with royalty agreements at the time the licensed materials are available to the licensee and collections are reasonably assured.
- Magazines - Magazines on various topics also form a major part of the publications revenue.
- Magazine Advertising - The magazines contain advertisements and blow-ups.
- Scholastic In-School Marketing - In this focus lies on presenting related merchandise to the school-children. Regular exhibitions and offers are conducted for this purpose in the schools.
Marketing to Children
A paper published by Sharma& Dasgupta on planning the framework for marketing to children identifies the zones under which literary works meant for children can be classified and attempts to identify the type of marketing activity that is needed. This paper seeks to identify the focus areas for marketing strategies targeting children. It seeks to help marketers tailor their strategies to create maximum impact in the children's segment. The paper researches the growing purchasing power of the children and the relationships between parents and their children when it comes to making purchase decisions.
According to the authors, upbringing has become more liberal and families have become ''negotiation families'' (Du Bois-Reymond et al., 2001), where influence may travel in either direction between parent and child (Bridges and Briesch, 2006) and parents have become more accepting of children's preferences (John, 1999). As the extent of children's influence increases, children are becoming a part of most marketers' target audience even if they are not part of the target market".
Depending on the degree of interest and the level of influence children have for different product categories, three distinct zones of influence have been defined by the authors. Marketing strategies would differ on the basis of these zones:
- Preference zone are those in which parents are the initiators, decision makers and purchasers but they may take into account the preferences of the child
- Pester zone is where the parents are the decision makers and purchasers but children have very strong influencing power. Bargaining and persuasion are employed as children grow older, and demands for products turn into discussions and compromises between parents and children (Rust, 1993; Palan and Wilkes, 1997). In this zone, marketers definitely need to address children through some marketing activities either independent to or in conjunction with activities targeted at parents. Marketing activities targeted at parents will aim to create some level of awareness, and if possible, liking, for the brand. Harry Potter is one example where the ability of the brand (a children's book), to create excitement among both children and parents the world over, was a critical reason for its success.
- The purchase zone is where parents may be the purchasers while children are the decision makers or co-decision makers. In product categories where children are co-decision makers, marketers need to cover both parents and children through their marketing programs. Focus should be to provide information and highlight the value proposition as well as create excitement around their brand.
The Harry Potter Brand
The brand Harry Potter is has become a multi-billion dollar business worldwide spanning national and industrial boundaries. From books, the brand has been successfully been able to establish a presence in the media industry through films which became internationally acclaimed bestsellers. The Harry Potter brand is valued in excess of $15 Billion out of which the largest source of revenue is the seven Potter novels. The various components of the revenue stream can be broken down as follows:
We shall attempt to study the success of the Harry Potter brand through application of the marketing mix or 4P's of marketing on the launch of the seventh book "Harry Potter and the Deathly Hallows" which sold a record 44 million copies worldwide.
The Harry Potter books are the largest revenue earners for the Harry Potter brand and the core from where the success of the brand stems. The books have broken all time records for the most number of copies published (320 million and counting) and have been on the international bestsellers list for years.
Where the packaging is concerned, all of the seven books in the series were made colorfully vibrant and attractive. Different cover versions were released for the adult and children readers respectively. Raincoast publishers in Canada used eco friendly paper for printing the books.
Also, merchandising has become a very successful revenue stream for the brand and Hasbro has been successful in launching Harry Potter memorabilia worth millions.
The pricing of the books was very exclusive owing to the excessive demand for the books especially the last four of the series. From a starting price of Rs. 250 for the first book the price escalated to Rs 1100 for the seventh book in the series.
Discounts were provided to online purchasers and advance booking which helped in garnering an overall estimate of the number of copies required for the initial print run.
Distribution (Place) Decisions
Distribution is about getting the products to the customer. Indirect channels of distribution included retailers, distributors and wholesalers. Web Sales was the only direct channel of distribution used. In the case of the launch of the final Harry Potter book "The Deathly Hallows" that meant delivery of 12 million copies in the US alone to different retailers/distributors for the opening of the sale of books at midnight on July 21, 2007. This involved coordination of between Scholastic and the members of the security team, safety, maintenance, customer service, and as well as rail and truck operations managers. The book was launched simultaneously at the same time across 29 countries and the shipments were moved through trucks, LTL, rail and air. The channel members involved the publishing house, courier/transport services, security providers, retail outlets and customer service representatives.
In the context of the marketing mix, promotion represents the various aspects of marketing communication, that is, the communication of information about the product with the goal of generating a positive customer response. In the case of Harry Potter and the Deathly Hallows, promotional activities were undertaken well before the launch of the novel. Some of the prominent activities are listed below:
The Schoslatic "There soon will be 7" Marketing Plan
Listed below are the activities carried out by the Scholastic Corporation carried out before the release of the "Harry Potter and the Deathly Hallows", the final book of the series. A record breaking first printing of 12 million copies in the US was announced accompanied by a multi-million dollar advertising campaign. Following are the details of the marketing plan:
- 7 Questions of Harry Potter campaign which released one question every two weeks for fans to debate on. These questions were highly debated through online media, book clubs and were answered by JK Rowling in the seventh book
- Knight Bus National Tour was organized on June 2nd, seven weeks prior to the release of the book. The bus started from New York and travelled across 40 libraries in 10 major metropolitan cities and fans were given a guided tour and asked to share their thoughts on videos.
- Retail promotions included THERE WILL SOON BE 7 table top easel backs and millions of collectible bookmarks distributed to retail accounts and libraries throughout the country
- Book Release Party Finder - this online guide will list various retailers' midnight parties nationwide searchable by zip code, city and state so fans can find a celebratory party to attend in their community.
The launch of the book on July 21, 2007 was marked by an all night signing and book reading of Harry Potter and the Deathly Hallows by authoress J K Rowling at the Natural History Museum in London along with 1700 guests which were chosen by ballot. A similar event was hosted in October 2007 when Rowling toured the US and this was held at Carneige Hall and the guests were invited through sweepstakes.
Scholastic also hosted "Harry Potter Place"a magical and interactive street celebration at Scholastic headquarters in New York City, where the first U.S. signed edition of Deathly Hallows was unveiled on 20 July 2007. The festivities included a twenty foot (six metre) high Whomping Willow, face-painting, wand-making, fire-eaters, magicians, jugglers and stilt-walkers
J. K. Rowling arranged with her publishers for a poster bearing the face of the missing British child Madeleine McCann to be made available to book sellers when Deathly Hallows was launched on 21 July 2007 and said that she hoped that the posters would be displayed prominently in shops all over the world
In Depth Interviews
The role of this research is exploratory in nature, so we are taking respondents equally distributed with their socio economic classification. Respondents have been taken from SEC A&B and belonging to metropolitan cities due to availability of sample size and accessibility to public libraries and large retail formats. Allahabad has been taken due to availability of sample and to observe changes in the reading habits in the absence of retail outlets like Crossword and Landmark. There has been an equal distribution gender wise as well so as to bring out clearly the differences between preferences regarding reading styles.
The three different age groups have been deliberately taken these are the formative years as far as reading is concerned. Also, the difference between preference for literature before and after puberty can also be observed. A greater number of respondents have been taken from the age group of 16-17 as we believe that the influence of parents on purchase decisions is relatively lesser in this age group. Also, definite changes regarding lifestyle and reading habits are formed in this age group. Also, it will be in-depth interview over a prolonged time as it is necessary even for rapport building and trust gaining since here we are dealing with children.
- The lives of the children across all age groups mainly encompasses around school and related work. Most of the kids are free only in the evening after they have come back from their tuitions and completed their course work for the day
- Books form a very small part of their time spent for leisure. After being cooped up in rooms all day, a majority of the kids prefer to go out and play or watch television. The urge to indulge in physical sports is more prominent in boys rather than girls. Book reading was relegated to being a bed time activity or as a weekend activity.
- The brand recall of Harry Potter was very high amongst the kids. Even kids who had not read a single book were familiar with the brand name and had watched at least one movie.
- Almost all children were given pocket money by their parents which was used to buy comics. Expensive books like Harry Potter were purchased and gifted by parents or relatives when asked by children
- Memberships in libraries are sought by parents and these provide for a majority of the reading material
- Cost is an important deciding factor when it comes to the purchase of books. Presence of libraries makes it feasible for children to lend books rather than purchasing them. However, in case of favorites like Harry Potter, Chetan Bhagat and popular comics like superman and spiderman
- Purchase of books for leisure reading are often impulse decisions done at the time of purchase of textbooks
Children Aged 10-12
- Popular literature apart from Harry Potter comprises of the Famous Five, The Hardy Boys, Nancy Drew Series, Superman and Spiderman Comics
- They like Harry Potter series mainly because the like "magic" and because they identify with the experiences that Harry is going through in his school life
- Harry is the most liked character because "he is smart, intelligent, brave and because he fights against Voldemort"
- Upon asking, most respondents replied that they saw themselves as Harry Potter in the book series. Only one respondent replied that he identified with Ron Weasley, who was good at heart but never excelled at anything.
- Children do not own a lot of books, but comics they collect. Library books form a major portion of their reading
- Pocket money provided to children is minimal. Parents purchase books for kids when they require them
- Other leisure activities comprise of sports, watching television and playing video games(console and on a computer)
- Watching Harry Potter movies is considered more exciting than reading the books because they can then visualize the action sequences. The book can sometimes can lengthy and boring
- A couple of respondents bought books from the Scholastic Fair in their school
Children Aged 13-15
- The online media is very popular with this age group. Recently discovered delights of social networking were being explored. However, ebooks were not popular as they didn't have that much time and were not accustomed to reading in that manner. A major chunk of their leisure time was taken up by the internet.
- Parents often endorsed the usage of internet and almost all homes had broadband connectivity
- The teenagers have entered the phase of the board examinations and hence everything takes a back seat
- Pocket is provided but is not used to purchase books. Teens ask for money and then purchase it themselves
- Apart from popular fiction, other books bought included encyclopedias, additional school books and books on lifestyle and philosophy. Emphasis was laid on improving general knowledge
- Books are not purchased from retail outlets. However, the pirated books available in the markets of metros like Delhi are quite popular. Here, they are bought in bulk
- For children in smaller town, school libraries are still the main source of reading materials
- Most girls admitted to having acquired romantic fiction like Mills and Boon from stores.
- There was no clear majority as regards to the favorite character in the books. A couple of male respondents voted for Hermione Granger as being "smart, intelligent and pretty". The girls seemed to like Harry Potter, Ron Weasley and Hagrid as a second favorite character. Dumbledore also seemed popular for being "powerful and concerned about others"
- Comics still seem to be popular especially amongst boys. Charlie Chaplin, Mr. Bean, Batman and Superman seem to the most popular. Chacha Chaudhary, Tinkle and the Fantastic Four were also quoted by several
- The teenagers have developed a liking for books like The Wit of Tenaliram and The Adventures of Sherlock Holmes
- Most own a personal collection of favorites comprising 25-30 books
Children Aged 16-17
- Here again, the pressure of board examinations takes precedence over other activities
- Most respondents had two wheelers which were used to commute. Hence, the pocket money was increased and they had much more free time. Expensive textbooks as well as other literary works were bought with the money sanctioned by parents
- The purchases were made by the respondents themselves as they had conveyance and more freedom
- The pressure to perform in examinations is there but they these set of teenagers find more time for leisure activities
- Genres of fiction involve detective, fantasy, science and mystery.
- The most popular works comprised of authors like Sydney Sheldon, John Grisham, Robin Cook, Arthur Hailey, Alistair Maclean
- Literature relating to lifestyle like Chicken Soup for the Teenage Soul, Works of Paulo Coelho etc. were also very popular. In some case classics and books on poetry were also recommended
- Libraries were again an important source for the books. School libraries were not that popular amongst this segment mainly due to scarcity of popular works
- Due to the pressure of national level competitions, a lot of respondents admitted to having read motivational and self grooming books along with books enhancing their general knowledge
- All the respondents in this category had read at least one Harry Potter book and watched at least one movie. Their premier source of information about the books was through friends and through the internet
- The Potter series were well liked because of their humor, story plot and display of characters.
- Here again, there was no clear majority on the favorite character in the book.
- The works of Chetan Bhagat were quite a rage amongst the student population especially students aspiring to become engineers. 5 Point Someone had been read by all the respondents. The low price of Rs. 95 was greatly attractive to the consumers and most of them had purchased at least one book
- Retail chains like Landmark and Crossword are preferred by readers because it gives them the variety coupled with the space they want to hang out and peruse the books at leisure
- In India, the youth don't have much leisure time. Due to increasing pressure of state and national level examinations, the children are forced into a daily routine of academic rigor since quite an early age. Leisure activities like sports, music and reading are endorsed by parents but only as long as it doesn't interfere with the course work of the children
- The importance of parents in the purchase decisions keeps on decreasing as the children grow up. While they still control the purse strings, the role shifts from being the sole decision maker to being an influencer to finally just being the financer. However, a lot of parents are taking the initiative of recommending personal favorites to their children
- The internet is a major source of information for children and their parents. Often recommendation by relatives/friends is followed up by an information search on the internet.
- The reasons for the popularity of the Harry Potter novel shifted as the children grew up and became more discerning. While preteens crave the magical fantasy that the book projects, young teenagers are more caught up with the story plot and the experiences in the school life of Harry Potter and his friends that they can relate to. The older teenagers developed an appreciation for the cast of the characters, the overall flow of the story, the humor etc.
- The shift in the mindsets of the children as they grow up can also be seen through their selection of the favorite character. While the respondents in the pretween age group unanimously went with Harry for being "kind, humble, caring and powerful" the younger teenagers segregated in their outlook and others characters in the book were appreciated. For older teenagers, post puberty, the appreciation of the female characters had set in. Hermione Garnger (played by Emma Watson in the movie) was cited as being "intelligent and beautiful".
- Libraries are a very important source of books for children whether it is public or school libraries. Likewise, larger retail chains like Landmark and crossword are taking precedence over smaller retail outlets for want of variety and space.
- Cost is an important factor while purchase of books. A price range of Rs. 200-300 is considered affordable but a price above that requires careful deliberation
The study gives an overview of a booming Indian book market which has large untapped potential. With a population of over 1.2 billion and a literacy rate of 65%, the Indian market has caught the eye of investors, writers and publishers around the world. This research attempts to understand the dynamics of the book market and more importantly the minds of a portion of its consumers.
Understanding and documenting the lifestyle patterns of children will help writers and publishers to gauge their customers better and customize their work accordingly. It also looks at the future scope of Indian writers in markets other than India.
The case study of Harry Potter was taken in an effort to understand how a global brand was created into a multi-billion dollar industry. A success like that fuels the growth of related industries and helps expand the market further. An analysis of brand based on the marketing mix helps future marketers follow a structured process towards the successful launch of a brand.
Understanding the varied customer base is extremely crucial to the success of any brand. This study defines some of the nuances in the lifestyles and behavioral patterns of the Indian consumers. For example, the extent of parental control over children in India is significantly more than in other developed markets. They are not only the financers but also play an influencing role in the purchase decisions as well. Hence, a marketer would do well to target some communication towards parents as well.
Hence, writers and marketers should have a thorough understanding of the target group as well as a well defined sub-classification within that group. Therefore, this study signifies the importance of the Indian Children's book market and the role of children in it.
Due to unavailability of time and resources, this study was conducted amongst a very small sample in the northern and western part of the country. For a true and accurate assessment, the research needs to be performed pan-India and the sample size needs to be significantly larger. Also, a greater detail of knowledge is required in the area of statistics and figures which support the growth of the market.
- The research gives an overview of the publishing of Children's books in India and the various dynamics of the industry. It identifies key drivers as well as potential entry points and pitfalls for a writers/publishers in the Indian market
- The study can be used to understand the customer base for children's writing in India and the types of works that are popular amongst them. Based on the results, writers can publish worked targeted solely at a particular segment
- Identification of popular works of fiction and the marketing strategies that can be used create a global brand like Harry Potter
- Understanding the lifestyles and reading habits of tweens and teenagers and identifying various touch points which can help in preparation of successful sales and marketing strategies
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